EPA rules won't cripple electricity grid, report says

CHARLESTON, W.Va. -- Proposed federal regulations to curb toxic emissions from coal-fired power plants won't cripple the region's electricity grid, according to a new report from the firm that manages that system.

PJM Interconnection analysts concluded that their grid still would have ample power to supply customers, even after the expected retirement of aging coal plants that can't meet the new U.S. Environmental Protection Agency rules.

"Resource adequacy does not appear to be threatened," the PJM report said, especially after considering new natural gas plants expected to come on line.

Industry groups, business leaders and some utilities have cautioned that the EPA proposes to implement a series of new air pollution rules too quickly.

Among those EPA proposals was one issued in June to, for the first time, regulate hazardous air pollutant emissions from coal-fired power plants.

Soon after the EPA proposal was issued, American Electric Power said it planned to close three aging facilities in the state by the end of 2014. However, the power company already had planned to close those facilities -- the Kanawha River Plant in Glasgow, the Phillip Sporn Plant in New Haven and the Kammer Plant near Moundsville -- sometime between 2017 and 2020.

AEP Chairman and CEO Michael Morris has warned about the EPA plan's potential impacts on electrical system reliability, but also said those impacts would not be "devastating." Still, AEP and other utilities are lobbying Congress to try to force the EPA to slow down.

Last month, a report from the nonpartisan Congressional Research Service concluded that the EPA plans would not cause the economic "train-wreck" business leaders have warned about.

In its report, PJM says some grid impact could be felt, but that they would not be widespread.

"Although no system-wide capacity problem is apparent in PJM from the announced retirements, this does not meant that localized reliability concerns may not arise given the location of particular units and the unique locational services they provide such as congestion management of particular transmission facilities, voltage support for the transmission system, or black-start services," the PJM report said.

PJM urged the EPA to provide a "reliability safety valve" in its rules, to address those kinds of circumstances.

"The key is whether replacement resources or transmission reinforcements can be timely added given the breadth of the potential retirements and the pressure on outside vendors to supply new turbines and related resources," the PJM report said.

PJM manages the electrical grid in all or parts of West Virginia and 13 other Mid-Atlantic and Midwestern states, from Illinois to New Jersey.